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To import audio from the Music Library on the device, open the Audio Browser by Long-Touching on a track, and select 'Audio' from the Hotbox that pops up:
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Select the tab labled 'Music Lib' and browse for a song to import:
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Tap the 'Import Copy' button:
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Now use the Hotbox again and select 'Paste':
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The audio will now be on a Region ready to go: